Air Canada takes huge loss amid pandemic travel shutdown

MONTREAL: Air Canada on Friday announced a loss of more than CAN$1.7 billion (US$1.27 billion) in the second quarter due to the "devastating effects" of the coronavirus pandemic. With travel at a near standstill, the airline's revenue fell 89 percent in the April-June period, with most flights suspended due to containment measures and border closings imposed to stem the pandemic, Air Canada said in a statement.

The number of passengers fell 96 percent compared to a year ago, forcing Air Canada to cut 20,000 jobs, more than half its workforce, the company said. "As with many other major airlines worldwide, Air Canada's second quarter results confirm the devastating and unprecedented effects of the Covid-19 pandemic," the airline's chief Calin Rovinescu said.

Revenue plummeted to $527 million, compared to over $4.7 billion in the same period in 2019, when the airline saw net income of $343 million. In contrast with the shutdown of passenger service, cargo revenue rose 52 percent to $269 million, with the conversion of Boeing 777s and 787s to carry medical equipment to deal with the pandemic. Citing a "impossible operating environment" after Canada imposed some of the world's "most severe" restrictions, Rovinescu called on Ottawa "to take prudent steps to replace current blanket travel restrictions and quarantines with targeted evidence-based measures that reflect current circumstances."

After taking some painful steps to respond to the unprecedented crisis, he said the airline is looking forward to the "equally unprecedented opportunity to rebuild a smaller but even more nimble airline, with a simplified and younger fleet and a lower cost structure coming out of the crisis."